Improving energy efficiency through very smart metering

With existing technology, it is entirely possible to build houses that allow their owners to be dramatically more energy aware. For instance, it would be relatively easy to build electrical sockets connected to a house network. It could then be possible to see graphically or numerically how much power is being drawn by each socket. It would also be easy to isolate the energy use of major appliances – furnaces, dish washers, refrigerators – thus allowing people to make more intelligent choices about the use and possible replacement of such devices. In an extreme case, you could have a constantly updating spreadsheet identifying every use of power, the level being drawn, the cost associated, and historical patterns of usage.

Being able to manage electrical usage through a web interface could also be very helpful. People could transfer some of their use of power to low-demand times of the day. They could also lower the temperature in houses and have it rise in time to be comfortable by the time they got home. Such controls would also be very useful to people who have some sort of home generating capacity, such as an array of solar panels. A web interface could provide real-time information on the level of energy being produced and the quantity stored.

While all of these things are entirely possible, there do seem to be two big barriers to implementation. The first is in convincing people to install such systems in new houses or while retrofitting houses. The second is to make the systems intuitive enough that non-technical people can use them pretty well. The first of those obstacles would be partially overcome through building codes and carbon pricing. The second is mostly a matter of designing good interfaces. Perhaps an Apple iHome is in order.

I read somewhere about how homes could have a big “Turn everything off” switch beside the front door, to hit when nobody will be home. Some appliances are obviously exempt (hot water heaters, fridges) but all the other lights and gadgets are killed in one place (not left in wasteful standby mode).

“The first is in convincing people to install such systems in new houses or while retrofitting houses. The second is to make the systems intuitive enough that non-technical people can use them pretty well”

All that needs to happen is for the utilities to charge a time of use or market rate. If it is economically viable, people will install or retrofit systems to manage their energy use.

Keep in mind we are in a heating climate most of the year. Reducing electricity by turning off your computer may just mean you burn more heating oil to keep your house at its desired temperature. The only real benefit of demand response is lowering system peak demand, since adding capacity will be expensive.

More than 200 households in Milton got to test drive the future of power management last year and the results show that homeowners, given the right tools and motivations, are more than capable of conserving energy.

The pilot project, conducted between July 2007 and Sept. 2008, was a collaboration between Milton Hydro, Direct Energy and Bell Canada. Households were given the ability to monitor their energy use through the Internet, as well as through BlackBerry-like devices, and to remotely control the lighting and operation of appliances in their homes.

An easy-to-use Web interface, designed by Toronto-based Lixar SRS, gave them a detailed view of how much electricity individual appliances were using at any point in time.

The results showed that one in 10 households given the control used 16 per cent less electricity over 12 months and 18 per cent less during peak periods.

Just 10 per cent of participants achieved the higher savings, which could be interpreted as a poor result. But the point of the pilot was to show what could be done, not necessarily what’s likely to be done today.

The challenge now is to refine the technology alongside the introduction of energy conservation programs and policies that drive behavioural change.

My column today was a snapshot of some energy management projects going on in Ontario, a sign that local utilities are getting energized about the possibilities of energy conservation, given the right technologies in the hands of homeowners and businesses.

I mentioned Milton Hydro’s 200-plus household project in Ontario, but I’d like to provide some context because the results only tell half the story.

I say only half the story because the Milton project was a bit of a mish-mash of different technologies, some of which worked and some that didn’t work so well. The fact that only 10 per cent achieved savings above 15 per cent per cent is a bit misleading because, as I understand it, different homes were tested with different technologies and protocols. The only common thread was the Lixar SRS energy management software, which Direct Energy hailed as the best part of the project. I’d like to emphasize this because Toronto-based Lixar is another Ontario cleantech company making waves beyond provincial borders. “The most impressive was the Lixar interface,” said David Dollihite, vice-president of product development at Direct Energy. “Lixar has got a leading edge customer user interface for the presentment of energy usage information, and the ability to turn that information into something that’s actionable.”

That line will soon be more than a bad joke. The Jetsons are coming to life as dishwashers, washing machines, and other home appliances begin to talk to each other and to the electricity grid in an effort to manage and reduce energy use.

Last week, for instance, General Electric and Boulder, Colo.-based smart-grid startup Tendril unveiled a deal to collaborate on software to connect the industrial giant’s “smart appliances” to the grid. Pilot projects with utilities are expected to begin by year’s end.

Given that about half of a typical home’s electricity consumption goes to power appliances, lighting, and water heating, so-called demand-response dishwashers and dryers could not only shrink your personal carbon footprint but allow utilities to avoid building new power plants to meet peak demand or firing up dirty ones to avoid brownouts.

“As GE readies appliances that communicate with smart meters in the hope of taking advantage of cheaper electricity rates, CNet asks a big question: Are consumers ready for the smart grid? Right now, most utilities only offer a flat rate, not time-of-use pricing, so the example of a drier that reacts to a ‘price signal’ about peak rates by keeping one’s clothes wet until a more affordable time is pretty much a fantasy. And longer-term, a big question is whether consumers will want to deal with the hassle of optimizing household appliance energy usage themselves, or be willing to relinquish monitoring and control to utility companies — with a concomitant loss of privacy. After all, losing one’s copy of 1984 is one thing — losing one’s lights and refrigerator is another thing altogether.”

Google has its PowerMeter, Microsoft has its Hohm and Obama has his “smart meters.” Got it? Good. Around two years after UK taxpayers began footing the bill for in-home energy monitors, it seems as if America’s current administration is looking to follow suit. While visiting the now-open solar facility in Arcadia, Florida today, the Pres announced that $3.4 billion in cash that the US doesn’t actually have has just been set aside for a number of things, namely an intelligent power grid and a whole bundle of smart power meters. Aside from boring apparatuses like new digital transformers and grid sensors (both of which are designed to modernize the nation’s “dilapidated” electric network), 18 million smart meters and 1 million “other in-home devices” will be installed in select abodes. The idea here is to give individuals a better way to monitor their electricity usage, with the eventual goal set at 40 million installed meters over the next few years. Great idea, guys — or you know, you could just advise people to turn stuff off when they aren’t using it, or not use energy they can’t afford. Just sayin’.

LIFE is looking up for managers at the 4,300 stores of Tesco, one of the world’s biggest supermarket chains. A program from CA, a big software firm, will make a tedious job much easier: gathering data about each store’s energy consumption, be it from lights, air conditioning or refrigeration. The streamlined data collection is part of Tesco’s ambitious plan to halve emissions of greenhouse gases from existing stores and distribution centres by 2020.

Tesco and CA may be pioneers, but they are not alone. While governments argue over emissions cuts, many firms have already started cleaning up their act, or at least preparing to do so—prompting more and more software firms to offer tools to help. If optimists are right, the market for “carbon-management software” could one day become at least as big as those for other important business applications such as customer-relationship-management (CRM) programs, which brought in revenues of more than $9 billion last year.

Many firms have tracked energy consumption for some time in an effort to save money. Others have monitored emissions of different kinds in order to comply with regulations on pollution. More recently, public pressure has prompted more companies to tally emissions and disclose the results in their annual reports or to outfits like the Carbon Disclosure Project. But most have used simple tools such as spreadsheets and databases.

EnerNOC’s main line of business is demand response. Utilities like to say that the most efficient power plant is the one that doesn’t have to be built. The theory in the utility industry is that it’s much cheaper to invest in measures that can cut use by 5 percent or 10 percent at peak periods (90-degree days in August) than it is to build and maintain a stand-by power plant that will be called into action a few days per year. Hence: demand response. Utilities negotiate deals with big users who agree to dim lights and turn down air conditioning or heating when called upon. They also pay companies like EnerNOC to do it for them. EnerNOC signs up big users—hospitals, colleges, office buildings—and installs software that analyzes facilities’ energy use and then calculates how they can shed load quickly without disrupting operations. There’s no installation cost for the user. EnerNOC shares with its customers the payments it gets from the utilities just for agreeing to be part of the plan to reduce usage. When customers actually do cut their use, they get additional payments. The demand-response model has proved attractive in a recessionary environment of pinched capital spending. Last year, EnerNOC’s “megawatts under management” rose 73 percent. Its Demand Response program has 2,800 customers and 6,500 sites. Unlike many energy efficiency programs, its benefits are clear and transparent. You get a check merely for agreeing to reduce energy use at certain times.

For infrastructures to become truly smart, however, it is not enough to put more intelligence into the core of a network. The edge—the interface with users and devices—also has to become clever. This is the idea behind smart metering, which has made a good deal of progress in the power industry. According to Accenture, a consultancy, there are about 90 smart-grid projects around the world today. By the end of last year more than 76m smart meters had been installed worldwide. That number will almost treble by 2015, to 212m, estimates ABI Research.

Smart meters and other gear needed to make grids more intelligent will not come cheap. Morgan Stanley, an investment bank, predicts that the worldwide smart-grid market alone will grow from $20 billion last year to $100 billion in 2030. Yet the benefits also promise to be huge: power savings, reduced investment in electricity generation and lower carbon emissions.

The place to go to see the technology in action is Boulder, Colorado, home to what is considered the world’s first fully fledged “smart grid”. The local utility, Xcel Energy, did not skimp. It deployed equipment that automatically reports power cuts. It installed more than 20,000 smart meters, connected them via a fibre-optic network, launched a website to track power use and has started to offer pricing plans that encourage shifting consumption to off-peak hours. It has even equipped some households with gear that tells air-conditioning systems to turn themselves off when demand for electricity is high, a mechanism called “demand response”.

The results so far are mixed. The system has certainly helped Xcel to run its grid more efficiently. The utility now knows what is happening in its network and power cuts have become rare. Problems can be pinpointed and fixed much more quickly. But customers are not using much less power than they did before.

Yet it is early days. Some firms are already beginning to show what can be achieved with demand response. EnerNOC, an American energy middleman, for instance, pays other firms for allowing it to shut down their non-essential gear at times of peak demand, thus freeing up capacity. By mid-year some 3,300 customers, from steel plants to grocery stores, had signed up. Their combined consumption, which can be made available to other users if needed, is 4,800MW, exceeding the output of America’s largest nuclear plant.

The main objective of smart power meters is to lower the peak load and thus enable utilities to keep down their peak generating capacity. In the water industry the economics are somewhat different, explains Stefan Helmcke, a water expert at McKinsey. Water can be easily stored and consumers have less discretion over when they use it (for instance, people cannot defer going to the toilet, which uses more water than any other activity at home), so the case for smart water meters is weaker.

Yet they are spreading all the same. Boston has long been the shining example. As early as 2004 the city’s Water and Sewer Commission had equipped almost all its customers with wireless smart meters. But it will soon be outdone by New York, which plans to install more than 800,000 of the devices at a cost of about $250m. Even Thames Water, most of whose customers have no meters of any sort, is now planning to install some of the smart kind.

Ontario’s environmental watchdog says the province has no idea if its hydro ‘smart meters’ are having any effect on electricity conservation.

The report is likely to cause controversy given the Ontario government’s plan to install the meters at every home and apartment in the province. The meters are supposed to allow utilities to charge consumers different prices for electricity at different times of day: high prices during peak times, lower prices at off-peak times.

The trouble is, according to Ontario’s environmental commissioner is that there’s no evidence the smart meters are having any effect on consumption patterns.

“The prices, set semi-annually by the Ontario Energy Board, are not based on actual data of how price levels affect customers’ consumption. [Time of use] prices should incorporate this real-world information in order to maximize the amount of conservation,” Gord Miller said in a news release accompanying his annual report.